Chancellor insists people will benefit from investments by the 2030s
Chancellor of the Exchequer Rachel Reeves during a visit to Neville Hill TrainCare Depot in Leeds, for the announcement of plans to improve rail connectivity in the North of England(Image: PA)
The Government’s massive rail ambitions have been welcomed by business leaders – but they have also called for more concrete commitments to make sure the region’s much-needed transport improvements actually happen. Yesterday, Rachel Reeves confirmed the Government would push ahead with a Northern Powerhouse Rail programme to improve rail transport across the north, while the Government also said it would plan a new Manchester-Birmingham line.
The North has seen several major transport plans come and go, including the northern leg of HS2 and the earlier Northern Powerhouse Rail proposals. But the Chancellor insisted people would see progress soon.
She said: “By the early 2030s I want people to feel the benefits of these investments. I don’t want to have to wait until the whole line is built for anyone to get any benefit.”
She added: “For me, this isn’t just political, this is personal. Because for a long time, the north of England and my constituents have been let down and been fed false promises.
“I’m determined that we are now finally going to deliver, and that this Labour Government is going to deliver what previous governments have promised but failed to get over the line, and that is Northern Powerhouse Rail.”
The first phase of the NPR scheme would see improved connections on existing lines on routes between Sheffield and Leeds; between Leeds and York; and between Leeds and Bradford. The second phase would be a new route between Liverpool and Manchester via Manchester airport and Warrington, using new and existing lines. The third phase would see better connections from Manchester to Leeds, Bradford, Sheffield and York.
Subrahmaniam Krishnan-Harihara, director of business policy and research at Greater Manchester Chamber of Commerce said: “Regardless of the specifics, the core economic case for Northern Powerhouse Rail remains unchanged: it is about bridging the ‘mental distance’ in the North of England.
“To become a successful economic region that can contribute to rebalancing the UK economy, the cities in the North should function as a single, cohesive labour market. In the North of England, a distance of 40 to 60 miles, such as between Manchester and Leeds or Leeds and Hull often feels like a barrier rather than a bridge.
“Therefore, a high-speed east to west link becomes critical. It is not just about saving minutes in a journey timetable; it is about building new capacity and enabling psychological proximity thus transforming the North of England into a unified economic powerhouse where talent and investment can freely flow. And that is the standard by which any new proposal must be measured.”
Business group: ‘Commitments have to be concrete this time’
Phil McCabe, FSB representative for the North West, said: “These are very welcome announcements the north has long been waiting for, but the commitments have to be concrete this time.
“This kind of investment will allow the north to truly spread its economic wings and lift off to deliver the meaningful productivity growth the region is capable of and the country the country needs.
“Faster journey times on new lines with brand new stations will make it much easier and quicker to travel around the north, reducing journey times and unlocking the regional travel barriers that have existed between the wider northern region’s big cities, which have long stymied the economic ambitions of the region and exacerbated the north-south divide.
“However, if we’re serious about growing and rebalancing the UK economy, improving connectivity between our northern towns and cities – whether it is metropolitan areas or those that are more rural – it is essential that those areas which may not see immediate investment are not left out.
A phase map of Northern Powerhouse Rail(Image: )
“This should be seen as a reset to enable investment, local and national, across the north, enabling further and more ambitious connectivity projects to unleash the potential we have here and create growth opportunities for the whole of the region.”
The FSB is also calling for northern businesses to be given procurement opportunities to provide goods and services as the project is built.
Mr McCabe said: “This is a once in a century opportunity for the North, and the Government must make sure every last drop of value is wrung from the process – and that needs to start now. The Procurement Act, which came into law in February last year, allows the build to be much more flexible in terms of awarding contracts to smaller firms. This is an opportunity that must not be missed.
“The Government must also commit to working with local authorities and public bodies to get the final blueprint right. That means no cut-price shortcuts which will go on to stymy future growth ambitions and expansion of the new network. An underground station at Manchester Piccadilly is a must, for example.
“After years of talks and uncertainty, the Government now needs to push forward at pace, delivering much needed rail improvements for business, growth and jobs.”
‘The focus must now be on delivery’
Stephen Cowperthwaite, managing director, Liverpool and UK Regions at Avison Young, said: “This announcement represents a genuinely significant moment for the North. Long-term, coordinated investment in connectivity is fundamental to unlocking productivity, attracting private capital and supporting sustainable growth across our city regions. Northern Powerhouse Rail has the potential to be transformational if it is delivered with pace, clarity and commitment.
“From a property and regeneration perspective, faster and more reliable east–west links are critical. They enable labour markets to function at scale, support housing delivery in the right places, and give businesses the confidence to invest for the long term. The Liverpool-Manchester Railway, in particular, will be instrumental in driving inclusive growth, linking two great innovation cities.
“As members of the Liverpool-Manchester Railway Partnership Board, we have been supporting the Mayors and the Liverpool-Manchester Railway to design an ambitious approach to delivering this key infrastructure. This strategy provides an opportunity to accelerate that momentum widely across the North.
“The focus must now be on delivery. Aligning national investment with local plans, mayoral leadership and private-sector partnership will be key to ensuring this funding translates into real economic benefit for communities, businesses and working people across the region.”
Engineering group says lessons must be learned from HS2
Sam Gould, director of policy and external affairs at the Institution of Civil Engineers said: “The news that the government has committed to delivering Northern Powerhouse Rail is hugely welcome and long overdue. But the government and other stakeholders must learn the lessons from HS2.
“Namely, as the ICE set out in our report in 2024, the purpose of the project must be clear, who is in charge must be clear, the right capability and understanding must be present in government departments, and the project must be sufficiently developed before ground is broken.
“If the government’s vision for the North is realised it could be transformative not just for Leeds, Manchester and the other great Northern cities, but for the whole UK.
“The ICE is ready to work with government to ensure the right pieces are in place to stay the course and deliver this vision successfully.”
The High Speed Rail Group (HSRG) has welcomed the proposals for a new Manchester-Birmingham line.
Chancellor of the Exchequer Rachel Reeves (centre right) with leaders including metro mayors Steve Rotheram and Tracy Brabin during a visit to Neville Hill TrainCare Depot in Leeds, for the announcement of plans to improve rail connectivity in the North (Image: PA)
A spokesperson for HSRG said: “The Government’s commitment to build a new line from Birmingham to Manchester is essential and the right decision. It will maximise the benefits of the investment already made into HS2 and avoid locking in Britain’s biggest bottleneck north of Birmingham.
“The industry is concerned, though, that the timescales for delivering this new line appear uncertain and potentially some decades away. We are also concerned that the Government does not intend to extend the land purchase powers between Birmingham and Crewe, which expire next month.
“It makes more sense to retain these legal powers whilst the Government develop a clear, costed plan for connections north beyond HS2.
“Nonetheless, today is a step forward in recognising that the previous plan did not work. We look forward to working with the Government to develop the plan for an affordable new line from Birmingham to Manchester, which is key to unlocking economic growth in the north of England.”
The Rail Freight Group (RFG) has welcomed the Government’s announcements, but says rail freight capacity and capability must be “embedded in the plans from the outset”.
Government must consider freight and engineering needs
Maggie Simpson OBE, director-general at the Rail Freight Group, said: “It is great to see this significant commitment to developing the railways across the North and Midlands. It is essential that the plans support the growth of rail freight, supporting new industries, infrastructure and consumers across the region.
“NPR must, however, not delay the successful completion of the Transpennine Route Upgrade, which will provide transformative capacity and gauge capability for rail freight.”
Ben Brittain, director of public affairs at the Association for Consultancy and Engineering, said: “This is a smart, pro-growth decision that strengthens the backbone of a national rail network fit for the demands of a modern economy. A new direct Birmingham–Manchester connection, alongside Northern Powerhouse Rail, provides the missing link needed to improve productivity, attract investment and better connect people to opportunity.
“Our members will work hand in glove with government to move quickly from announcement to delivery, starting with clarity on delivery timelines and scope. The economic transformational effect of these infrastructure projects need to be felt quickly, so speed of delivery is mission critical. By bringing commercial discipline, engineering expertise and a clear focus on outcomes, we can remove obstacles, control risk and ensure these projects are delivered efficiently and deliver real value for taxpayers and businesses alike.”
Rail union TSSA – which represents staff directly employed by HS2 – welcomed the ambition but said more detail was needed.
TSSA General Secretary, Maryam Eslamdoust said: “This announcement seems to be long on aspiration but desperately short on delivery details. The fact remains that following nearly 15 years of Conservative austerity, rail workers and millions of passengers have heard too many promises about transforming northern rail, only to see projects delayed, diluted or dropped.
“It’s vital the government acts at pace to deliver these plans and signal a break with the austerity of the past, funding projects like Northern Powerhouse Rail by properly taxing the super-rich, not just ordinary hard-working people. If not, this risks becoming another press release instead of a plan, with delays, exclusions and public trust once again paying the price.”
